USD Net-Long Exposure Slows as JPY Sees Rare Win Against USD
The US dollar's net-long exposure has continued to decline, but at a slower pace than expected. According to the COT report, the current net-long exposure is $34.3 billion, which remains just $14.2 billion below its 11-year peak. However, most of the long covering occurred in the first week of the past three weeks.
The reduction in net-long exposure may be attributed to the US Treasury's buyback plan, announced on Wednesday. Despite this, the US dollar index has held above support, and traders have been reluctant to abandon the dollar.
The Japanese yen (JPY) has shown a rare win against the US dollar last week, with the US Treasury's attempts to limit long-dated US bond yields contributing to its weakness. However, old habits die hard, and the JPY has seen short positions return.